India’s economic growth dips below 6%. Time to panic?

It's not as bad as the anemic "Hindu growth rate" of days gone by, but the numbers confirmed the most pessimistic views of the Indian economy in the fourth quarter ended March 31, dropping to a dismal 5.3 percent.

Is it fair to say that the only thing hot about India these days is Delhi? My indoor/outdoor thermometer read 114F/99.7F when I got in from the airport this afternoon. But my inbox and RSS feeds had worse news.

According to the Financial Express, growth hit a nine-year low in the January-March quarter as the manufacturing sector contracted. Meanwhile, the rupee's continued fall suggests the economy remains under pressure in the current quarter, the paper said.

Many analysts and observers were shocked by the economic data, though curmudgeons had been talking about 5-6 percent for awhile in dark corners (the Foreign Correspondents' Club, and other places where cheap whiskey is served).

According to the Financial Express, the numbers were lower than even the lowest forecast in a poll that had produced a median of 6.1 percent from predictions ranging between 5.5 percent and 7.3 percent.

The data also poses a dilemma for policymakers, as they have no fiscal room to stimulate growth, either through spending money or through cutting interest rates — as both the budget deficit and inflation are causing problems.

Soon after the growth numbers were announced, the rupee was trading near record lows of 56.4 against the dollar.